Goldman Sachs Hits Back At Japanese Tax Evasion Allegations

by Mary Swire, Tax-News.com, Hong Kong

18 June 2002

Goldman Sachs Japan has hit back at allegations that several of its affiliates attempted to evade Japanese taxes.

Responding to reports carried over the weekend by the Jiji Press, which suggested that seven Goldman affiliates had structured their financial affairs in such a way as to deliberately avoid paying tax on five billion yen ($40 million), spokesman for the investment bank, Orlando Camargo said on Monday that:

'We strongly object to the accusation of tax evasion. Taxes are paid in full observation with Japan's tax code.'

However, according to the Jiji Press report, Tokyo's Regional Taxation Bureau recently ordered the Japanese Goldman affiliates to repay around 1.5 billion yen in unpaid taxes and fines, a request to which they all acceded.

It was alleged that the seven companies transferred the funds in question to a Dutch company within the Goldman Sachs group, and that from there, the money was transferred to a company in the low tax Cayman Islands.

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